Demand is an economic principle that describes a consumer’s desire and willingness to pay a price for a specific good or service. Holding all other factors constant, an increase in the price of a good or service will decrease demand, and vice versa. What is Glocalization? Meaning, Definition!
Here are discuss What is Demand? Meaning and Definition!
In economics, demand is the quantity of a commodity or a service that people are willing or able to buy at a certain price, per unit of time. The relationship between price and quantity demands also known as the demand curve. Preferences and choices, which underlie demand, can represent as functions of cost, benefit, odds, and other variables. Determinants of (Factors affecting) demand Innumerable factors and circumstances could affect a buyer’s willingness or ability to buy a good.
Some of the common factors are:
The following are below;
Good’s own price:
The basic demands relationship is between potential prices of a good and the quantities that would purchase at those prices. Generally, the relationship is negative meaning that an increase in price will induce a decrease in the quantity demands. This negative relationship is embodied in the downward slope of the consumer demand curve. The assumption of a negative relationship is reasonable and intuitive. If the price of a new novel is high, a person might decide to borrow the book from the public library rather than buy it.
The principal related goods are complements and substitutes. A compliment is a good that is used for the primary good. Examples include hot dogs and mustard, beer and pretzels, automobiles and gasoline. (Perfect complements behave as a single good.) If the price of the compliment goes up the quantity demanded of the other good goes down.
Definition of Demand:
The following definitions below are;
- Commerce: A claim for a sum of money as due, necessary, or require.
- Economics: (1) Desire for certain good or service support by the capacity to purchase it. (2) The aggregate quantity of a product or service estimated to be bought at a particular price. (3) The total amount of funds which individuals or organizations want to commit to spending on goods or services over a specific period.
- The Law: An assertion of a legal right, such as to seek compensation or relief.
The amount of a particular economic good or service that a consumer or group of consumers will want to purchase at a given price. The demand curve is usually downward sloping since consumers will want to buy more as price decreases. Demand for a good or service is determined by many different factors other than prices, such as the price of substitute goods and complementary goods. In extreme cases, demand may be completely unrelated to price, or nearly infinite at a given price. Along with supply, it is one of the two key determinants of the market price.
Demand in economics is how many goods and services are being at various prices during a certain period of time. It is the consumer’s need or desire to own the product or experience the service. It’s constraint by the willingness and ability of the consumer to pay for the good or service at the price offer.
They are the underlying force that drives everything in the economy. Fortunately for economics, people are never satisfied. They always want more. This drives economic growth and expansion. Without demand, no business would ever bother producing anything.